The price differences are shown as below table. .
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As that table we can see clearly huge price gap between supplier companies. Allied Additive Ltd. price offer is 56 percent less than Sinclair and Moly Processors Ltd. price offer is 45 percent is less than Sinclair.
In my opinion, Sinclair Chemical Ltd. is applying that high price policy against Smoothslip because they are sure that their product quality is over the average if it is compared with the other producers and also they have enough stock to supply for us immediately and their plant is only twelve miles away, the others are over 50 miles distant so there is a significant save on transportation.
The current situation is Sinclair Chemical Ltd., a serious fire so they may not able to fill any orders for several weeks. This provides an opportunity to seek other suppliers. Smoothslip has to find new suppliers who can delivery in six weeks period because according to stock controller's estimation we have six weeks stock alongside with the cutting edge technology that SÝnclaÝr has developed. Furthermore, there are no available suppliers who can delivery in six weeks. All the suppliers' lead-time is nearly 8 weeks, because most of Sinclair Ltd. consumers diverted their order to others. We don't know exactly when the Sinclair Ltd. will start production back and it is difficult to estimate they can delivery us in eight weeks.
Recommendations for Long & Short Actions.
a) A Strategic Partnership, Right Lubricant and Quality to be pre-determined .
The partnership approach is not a clearly defined single concept but it is based on establishing trust as between buyer and supplier. Therefore given the trading relationship between SmoothslÝp and SÝnclaÝr the premium pricing that SÝnclaÝr charges, timing is appropriate to source other suppliers that may supply similar product. The Quality is made the prime requirement and the concept of total acquisition cost is adopted instead of price but ensuring that is not outprÝced as I have illustrated.